A.C.I.T., Circle-3(1), Gwalior V. Sh. Chandrabhan Singh Gaur, Shivpuri

ITA 296/AGR/2013

• Counselvise Citation: 29620314 RSA 2013
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-04-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 03-04-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 06-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANURADHA
• Keywords: Business income; Corroborative evidences

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER ITA NO. 296/AGRA/2013 ASSTT. YEAR : 2006-07 A.C.I.T., CIRCLE 3(1), VS. SHRI CHANDRABHAN SI NGH GAUR, GWALIOR. DEENDAYAL PURAM, JHANSI ROAD, SHIVPURI (MP) (PAN: AICPG 0512 F) (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. ANURADHA, JR. D.R. RESPONDENT BY : NONE DATE OF HEARING : 03.04.2014 DATE OF PRONOUNCEMENT : 25.04.2014 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A), GWALIOR DATED 30.05.2013 FOR THE ASSESSMENT YEAR 20 07-08, CANCELLING THE PENALTY U/S. 271(1)(C) OF THE IT ACT. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSE SSEE DERIVED INCOME FROM CONTRACT BUSINESS. THE TOTAL RECEIPTS FROM BUSINESS WERE RS.5.15 CRORES. THE ASSESSEE WAS REQUIRED TO PRODUCE BOOKS OF ACCOUNT A LONG WITH SUPPORTING EVIDENCES. THE ASSESSEE PRODUCED ONLY COMPUTERIZED CASH BOOK AND LEDGER, BUT NO OTHER SUPPORTING DOCUMENTS WERE PRODUCED. THE RECEI PTS SHOWN IN THE BOOKS OF ITA NO. 296/AGRA/2013 2 ACCOUNT INCLUDE THE RECEIPTS OF RS.1.59 CRORES RECE IVED FROM SIND PROJECT, RBC, KARERA AS PER TDS CERTIFICATES. THE DETAILS OR DOCU MENTARY EVIDENCES IN RESPECT OF BALANCE AMOUNT OF RS.3.56 CRORES SHOWN TO HAVE BEEN RECEIVED FROM PETTY CONTRACTORS RECEIPTS FROM SALE OF CRASHER STONE REC EIPTS FROM HIRING OF THE VEHICLE WERE NOT FILED. THE AO DIRECTED AS TO WHY THE BOOK RESULTS BE NOT REJECTED AND NET PROFIT OF 5% BE NOT APPLIED FOR COMPUTING THE BUSIN ESS INCOME. THE ASSESSEE REQUESTED THAT PROFIT RATE OF 4% MAY BE APPLIED AS AGAINST PROPOSED NET PROFIT RATE OF 5%. THE AO ESTIMATED THE TOTAL CONTRACTUAL RECEI PTS AT RS.5.20 CRORES AND BY APPLYING THE NET PROFIT RATE OF 5%, DETERMINED THE TOTAL INCOME AT RS.26,00,000/-. PENALTY PROCEEDINGS U/S. 271(1)(C) WERE INITIATED F OR FURNISHING INACCURATE PARTICULARS OF INCOME. AT THE PENALTY STAGE, THE AS SESSEE FURNISHED WRITTEN SUBMISSIONS FOR DROPPING OF THE PROCEEDINGS SUPPORT ED BY DIFFERENT JUDGMENTS. THE AO, HOWEVER, DID NOT ACCEPT THE CONTENTION OF THE A SSESSEE AND LEVIED PENALTY. THE ASSESSEE SUBMITTED BEFORE THE LD. CIT(A) THAT INCOM E IS ESTIMATED BY APPLYING HIGHER PROFIT RATE AND AS SUCH NO INACCURATE PARTIC ULARS HAVE BEEN FURNISHED. IN THE CASE OF CIVIL CONTRACTOR, IT IS NOT POSSIBLE TO MAI NTAIN EACH AND EVERY VOUCHER OF EXPENSES BECAUSE THE CONTRACT WORK ARE EXECUTED IN INTERIOR AND ODD PLACES AND ASSESSEES SUPERVISORS ARE ALSO UN-EDUCATED PERSONS . THEREFORE, THE ASSESSEE DID NOT FURNISH INACCURATE PARTICULARS OF INCOME. HE HA S RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIAN CE PETROPRODUCTS PVT. LTD., 322 ITR 158. THE LD. CIT(A) WAS OF THE VIEW THAT PE NALTY HAS BEEN LEVIED IN ITA NO. 296/AGRA/2013 3 RESPECT OF THE ADDITION MADE BY THE AO TO THE RETUR NED INCOME BY ESTIMATING THE CONTRACTUAL RECEIPTS AND NET PROFIT THEREON. THEREF ORE, IT IS NOT A CASE OF FILING OF INACCURATE PARTICULARS AND ACCORDINGLY, PENALTY WAS CANCELLED. 3. THE LD. DR RELIED UPON THE ORDER OF THE AO AND S UBMITTED THAT EVEN AT THE PENALTY STAGE, THE ASSESSEE HAS NOT FILED ANY EXPLA NATION. THEREFORE, PENALTY HAS TO BE LEVIED. THE ASSESSEE IS SERVED THROUGH DEPARTMEN T. SERVICE REPORT IS AVAILABLE ON RECORD. HOWEVER, NONE APPEARED ON BEHALF OF THE ASS ESSEE. THEREFORE, THE ASSESSEE IS PROCEEDED EXPARTE. 4. ON CONSIDERATION OF THE SUBMISSIONS OF THE LD. D R AND THE FINDING OF FACT RECORDED BY THE AUTHORITIES BELOW, WE ARE OF THE VI EW THAT PENALTY HAS BEEN RIGHTLY CANCELLED IN THE MATTER. THE ASSESSEE HAS DECLARED TOTAL RECEIPTS FROM BUSINESS OF CIVIL CONTRACT IN A SUM OF RS. 5.15 CRORES AND PROD UCED COMPUTERIZED CASH BOOK AND LEDGER BEFORE THE AO AT THE ASSESSMENT STAGE. H OWEVER, OTHER SUPPORTING DOCUMENTS WERE NOT PRODUCED. THEREFORE, THE AO ESTI MATED THE TOTAL CONTRACTUAL RECEIPTS AT RS.5.20 CRORES. IT IS, THUS, CLEAR THAT THE ASSESSEE HAS DECLARED COMPLETE RECEIPTS BEFORE THE AO AND THE SOURCE OF THE SAME. RECEIPTS OF THE ASSESSEE HAVE BEEN SLIGHTLY ENHANCED ONLY ON ESTIMATE BASIS WITHO UT POINTING OUT ANY SPECIFIC ITEM IF ANY WAS CONCEALED BY THE ASSESSEE OR ANY IN ACCURATE PARTICULARS WERE PLACED IN THIS REGARD. SINCE THE VOUCHERS OF EXPENSES WERE NOT PRODUCED, THEREFORE, PROFIT ITA NO. 296/AGRA/2013 4 RATE OF 5% WAS APPLIED FOR THE PURPOSE OF ESTIMATIN G THE BUSINESS INCOME OF ASSESSEE. THE ASSESSEE ALSO FILED WRITTEN SUBMISSIO NS BEFORE THE AO AT PENALTY STAGE. THEREFORE, THERE IS NO NON-COMPLIANCE AT ANY STAGE. HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASES OF DHILLON RICE MIL LS, 256 ITR 447 AND HARI GOPAL SINGH VS. CIT, 258 ITR 85 CONFIRMED THE CANCE LLATION OF PENALTY WHEN INCOME WAS FOUND DETERMINED ON ESTIMATE BASIS. IN T HIS CASE, THE BOOK RESULTS WERE REJECTED BECAUSE THE VOUCHERS OF THE EXPENSES WERE NOT PRODUCED. THEREFORE, IT IS NOT A CASE OF FILING OF INACCURATE PARTICULARS. THE LD. CIT(A) ON PROPER APPRECIATION OF FACTS AND MATERIAL ON RECORD CORRECTLY CANCELLED THE PENALTY. WE UPHOLD HIS ORDER AND DISMISS THE DEPARTMENTAL APPEAL. 5. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (PRAMOD KUMAR) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY